The iconic American automobile manufacturer Ford has reportedly forecast a $3 billion loss in its electric vehicle division this year, according to the Wall Street Journal. This represents a notable increase from last year’s deficit of $2.1 billion and the previous year’s $900 million. Despite these losses, Ford remains committed to its electric vehicle strategy, seeing it as a necessary investment in the future of the industry. The company is currently the second-largest player in the US electric vehicle market with a 7.6% market share, following Tesla’s dominant 65% share.
Ford is planning to strengthen its investments in the electric vehicle market, which includes the F-150 pickup truck, the Mustang Mach-E SUV, and a goal to produce 2 million electric vehicles annually by 2026. The company is also aiming to establish three battery factories in Kentucky and Tennessee, with the ambitious target of securing 70% of the batteries required for its 2 million annual electric vehicle production.
As expected, the cost of such investments will continue to grow, resulting in further deficits in the electric vehicle sector for Ford. However, the company’s Chief Financial Officer, John Lawler, has emphasized that such deficits are natural in the early stages of investment in the production capacity, technology, and market share of a startup.
Despite these setbacks, Ford has expressed confidence in its ability to generate profits in the electric vehicle sector starting in 2026. In the meantime, the company is still expecting to generate a significant profit of $9 to $11 billion this year in its internal combustion engine automotive sector. With sufficient resources to bear the high costs of strategic investments in the electric vehicle sector, Ford remains a major player in the automotive industry with a promising future ahead.
